Berachain (BERA) 30% Drop Triggers Short-Seller Frenzy: More Losses Ahead?
Berachain (BERA) faces intense selling pressure, with its price down 27% in a week. A break below $6.07 could trigger further declines, while a rally to $7.36 remains possible if demand strengthens.
Berachain (BERA) has suffered a steep decline over the past week, shedding 30% of its value as bearish sentiment plagues the general market.
In the past 24 hours alone, the token has slid another 6%, deepening concerns of further downside. With growing bearish bias against the altcoin, this might be the case in the near term.
BERA Faces Mounting Downside Risk
Berachain’s sharp decline has triggered a surge in short positions across its futures market. This rise in demand for shorts is evident in its funding rate, which has been negative since the token’s launch on February 6. At press time, this is at -0.11%.
BERA Funding Rate. Source:
Coinglass
The funding rate is a periodic fee exchanged between long and short traders in perpetual futures contracts to keep prices aligned with the spot market.
A negative funding rate means that short traders are paying long traders, indicating a stronger demand for short positions.
As with BERA, if an asset experiences an extended period of negative funding rates, it suggests sustained bearish sentiment. It indicates that the token’s traders consistently bet on further price declines. This prolonged negativity could increase BERA’s price volatility and extend its price fall.
In addition, BERA has noted significant fund outflows from its spot markets over the past few days. Per Coinglass, the altcoin has noted almost $2 million in spot market outflows today alone.
BERA Spot Inflow/Outflow. Source:
Coinglass
When an asset experiences spot outflows like this, it signals a surge in selling pressure. It indicates a bearish trend as investors reduce exposure or take profits, potentially leading to further price declines.
BERA at a Crossroads—Break Below $6.07 or Rally Toward $7.36?
Berachain trades at $6.14 at press time, resting slightly above support at $6.07. If the bearish bias against the altcoin strengthens, its price could break below this support floor, causing the token to trade at a low of $5.35.
If the bulls fail to defend this level, BERA could slip to its all-time low of $4.74.
BERA Price Analysis. Source:
TradingView
On the other hand, if market sentiment improves and BERA’s demand soars, its price could rally to $7.36.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
You may also like
Updated Version 4 - Mattel Investor Ariel Urges Sale Amid Stalled Turnaround
Ariel Investments holds a 5.4% stake in Mattel and believes the stock remains severely undervalued. Mattel stated it will take into account the opinions of Ariel and other shareholders. According to sources, Authentic Brands Group approached Mattel last week, with a potential valuation of around $6 billion. Analyst comments and a chart were added in paragraph 10. Juveria Tabassum/Angela Christy M Reuters, October 5 – A letter obtained by Reuters shows that a major shareholder of Mattel (MAT.O) on Monday urged the Barbie-maker to explore a sale, citing stagnant growth in performance and profitability. Ariel Investments, holding a 5.4% stake in Mattel, stated that the company’s stock is still severely undervalued. “We believe that strategic buyers would be willing to acquire your company at a price significantly above the current share price,” Ariel Co-CEO John Rogers wrote in a letter to Mattel’s board. The asset management firm suggested Mattel's options include “divesting significant assets, mergers, and/or an outright sale of the company.” Ariel believes other toy companies may be interested in Mattel’s asset portfolio, as well as entertainment firms and traditional private equity companies. In recent years, despite Mattel’s stabilizing business and the box-office success of the Barbie movie, the company has faced fluctuating sales and rising input costs. Operating profit has declined for six consecutive quarters. In after-hours trading, Mattel's shares rose 0.9% to $16.20. Ariel’s initiative comes as Mattel undergoes leadership changes (link). CEO Ynon Kreiz stepped down last month to become Co-CEO of Paramount Skydance (PSKY.O), while board member Roger Lynch—former editor-in-chief of Vogue and head of Condé Nast, parent company of The New Yorker—will assume the CEO role next month. Mattel replied to Reuters by email: “Our board and management team are committed to acting in the best interests of all shareholders, and will consider the views expressed in the letter from Ariel Investments, as well as those of other Mattel shareholders.” This is the second time this year investors have asked Mattel to consider strategic options. In May, Mattel investor Southeastern Asset Management called for the company to explore various options (link), including privatization, acquisition by competitor Hasbro (HAS.O), or by a major media company that could value Mattel’s assets more fairly than the public market. Last week, a person familiar with the matter told Reuters that Authentic Brands Group (AUTH.N) approached Mattel about a potential acquisition (link), which could value the toymaker at about $6 billion or higher. The source noted that there is no guarantee Mattel will accept Authentic Brands’ proposal, and the company is not conducting a formal sale process at this time. Following the news, Mattel’s share price soared. Despite the rebound, the stock remains down about 20% year-to-date. According to London Stock Exchange Group (LSEG) data, Mattel’s 12-month forward price-to-earnings ratio stands at 9.99, compared to an industry average of 14.03. “I think this just reflects the market’s frustration about the business possibly being a bit stagnant. Given the current level of valuation, now may be a good time to turn around the business away from the spotlight of investors,” said Morningstar analyst Jaime Katz. (For the convenience of non-English speakers, Reuters automatically translates its reports into several languages. As automated translations may contain errors or lack context, Reuters does not guarantee the accuracy of automated translation texts and provides them solely for readers’ convenience. Reuters assumes no liability for any loss or damage resulting from the use of the automated translation feature.)
42% premium, five years to break even with capital cost, Schneider Electric sets record with $23 billion acquisition of PTC, stock price plunges
Schneider Electric’s acquisition of industrial software company PTC marks the latest move by European industrial companies to accelerate their bets on AI. While the strategic rationale is acknowledged by analysts, the financial cost of the deal is heavy. PTC is expected to generate only about $1.5 billion in operating profit by 2031, and the anticipated cost savings to be realized three years from now will only contribute an additional $280 million.
Custodia Bank CEO Caitlin Long warns tokenized deposits could outpace stablecoins
Spacex closed up 7.6%, reaching a new high since June, helping Musk "regain" his trillionaire status
SpaceX's stock surged nearly 8% on Monday, with Elon Musk's net worth rebounding to approximately $1.03 trillion, reclaiming the top spot on the billionaire list. Morgan Stanley released a bullish report, setting a target price of $300 and stating that the company's value is underestimated. The rally was driven by multiple catalysts, including expectations for Starship recovery, expansion of AI business, and over $12.7 billion in defense contracts.
Crypto prices
More
